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FTX suggests Sam Bankman-Fried transferred assets to Bahamas government custody after bankruptcy: Filing


Sam Bankman-Fried, founder and chief executive officer of FTX Cryptocurrency Derivatives Exchange, speaks during an interview on an episode of Bloomberg Wealth with David Rubenstein in Latest York, US, on Wednesday, Aug 17, 2022.

Jeenah Moon | Bloomberg | Getty Images

FTX in a bombshell emergency court filing Thursday said evidence suggests Bahamian regulators directed former CEO Sam Bankman-Fried to realize “unauthorized access” to FTX systems to acquire digital assets belonging to the corporate after it had filed for bankruptcy protection.

The filing said that Bankman-Fried transferred those assets to the custody of the Bahamian government. It cites an interview published by Vox on Wednesday where Bankman-Fried expresses serious disdain for regulators.

“F— regulators,” he said within the interview. “They make the whole lot worse. They do not protect customers in any respect.”

“You recognize what was perhaps my biggest single f—-p?” he asked. “Chapter 11.”

The accusations were made by FTX in a motion in the US Bankruptcy Court in Delaware. In that motion, FTX said the alleged conduct puts “in serious query” a request by Bahamian regulators for recognition as liquidators within the bankruptcy.

“[I]n reference to investigating a hack on Sunday, November 13, Mr. Bankman-Fried and [FTX co-founder Gary] Wang, stated in recorded and verified texts that “Bahamas regulators” instructed that certain post-petition transfers of Debtor assets be made by Mr. Wang and Mr. Bankman-Fried (who the Debtors understand were each effectively within the custody of Bahamas authorities) and that such assets were “custodied on FireBlocks under control of Bahamian gov’t,” the filing said.

“The Debtors thus have credible evidence that the Bahamian government is chargeable for directing unauthorized access to the Debtors’ systems for the aim of obtaining digital assets of the Debtors—that took place after the commencement of those cases. The appointment of the JPLs and recognition of the Chapter 15 Case are thus in serious query,” the filing continued.

Sam Bankman-Fried was not immediately available to comment. The law firms representing FTX, Landis Rath & Cobb and Sullivan & Cromwell, didn’t reply to a request for comment. CNBC didn’t immediately receive a response to an email to the Securities Commission of the Bahamas.

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